Guangdong Huate Gas Co., Ltd (SHSE:688268) just released its latest quarterly report and things are not looking great. The analysts look to have been far too optimistic in the lead-up to these results, with revenues of (CN¥341m) coming in 35% below what they had expected. Statutory earnings per share of CN¥0.31 fell 44% short. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.
Taking into account the latest results, the consensus forecast from Guangdong Huate Gas' six analysts is for revenues of CN¥2.27b in 2025. This reflects a substantial 59% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to soar 71% to CN¥2.60. In the lead-up to this report, the analysts had been modelling revenues of CN¥2.34b and earnings per share (EPS) of CN¥2.64 in 2025. So it looks like the analysts have become a bit less optimistic after the latest results announcement, with revenues expected to fall even as the company is supposed to maintain EPS.
The consensus has reconfirmed its price target of CN¥58.53, showing that the analysts don't expect weaker revenue expectations next year to have a material impact on Guangdong Huate Gas' market value. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. The most optimistic Guangdong Huate Gas analyst has a price target of CN¥68.00 per share, while the most pessimistic values it at CN¥54.00. This is a very narrow spread of estimates, implying either that Guangdong Huate Gas is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.
Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. The analysts are definitely expecting Guangdong Huate Gas' growth to accelerate, with the forecast 45% annualised growth to the end of 2025 ranking favourably alongside historical growth of 13% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 16% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Guangdong Huate Gas to grow faster than the wider industry.
The Bottom Line
The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. They also downgraded Guangdong Huate Gas' revenue estimates, but industry data suggests that it is expected to grow faster than the wider industry. Still, earnings are more important to the intrinsic value of the business. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple Guangdong Huate Gas analysts - going out to 2026, and you can see them free on our platform here.
Don't forget that there may still be risks. For instance, we've identified 2 warning signs for Guangdong Huate Gas that you should be aware of.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
